California Wine Grape Growers Remove 25% of Vineyards

California wine grape growers are facing a severe market downturn as shifting consumer habits cause demand to plunge. U.S. wine sales declined 23% between 2020 and 2025, with total spending dropping from $94 billion to $74 billion. In response, Jeff Bitter, president of Allied Grape Growers, reports that farmers have removed approximately 25% of the state's vineyards from production.

This year, roughly half of the state's wine grape crop entered the harvest season without buyer contracts, a sharp decline from the typical 70% to 80%. Many farmers are harvesting at a loss, leaving crops to rot, or replacing vines with more profitable crops such as almonds, pistachios, and olives. Bill Berryhill, owner of Berryhill Family Vineyards, is removing 50 acres of vineyards due to these financial losses.

The decline is driven by younger generations drinking less alcohol for health and financial reasons, alongside increased competition from craft beer, spirits, and cannabis. Global consumption has also fallen in Europe and China, while tariffs have reduced exports to Canada, the largest foreign buyer of American wine. Rob McMillan of First Citizens Bank notes that the industry must now balance supply and demand while determining what modern consumers want.